What’s so Fishy about the Economics of Fishing?

Let’s dive into the economics behind one of humanity’s most significant food sources — seafood, or more specifically, fish. Many countries’ economies rely on fishing, preparing fish for international export, and of course, their citizens eating fish. Globally the production of fish, crustaceans, and molluscs was over 175 million tonnes — valued at over $406 billion USD (FAO, 2021). Perhaps the industry developed to this scale to meet the seafood cravings of our fast-growing global population. With an industry that large, it’s inevitable that there are some fishy things going on.

What’s so fishy about the economics of fisheries, especially in Canada? Among the top countries most involved in the fishing industry, Canada may not seem competitive by the numbers: the USD $9.1-billion-gross-value of Canada’s fishery industry appears to to pale in comparison with China, 2019’s top-ranking fishing country with a value of approximately USD $22 billion (FAO, 2021). However, in addition to being a significant contributor to Canada’s modern economy, fishing and seafood practices have been part of Indigenous peoples’ livelihoods since time in memoriam. Coast Salish First Nations on the west coast and Miꞌkmaq peoples on the east coast are just a sample of the Indigenous groups involved in fishing year-round prior to the impacts of European colonization, and many Indigenous peoples’ involvements and values for fishing practices continue today. 

Canada has also had a world-stage role in the cod fish tragedy of the late 20th century. It was like a gold rush, fish edition: what was once the world’s most abundant cod fish stock quickly dwindled as international and domestic fishing fleets rushed to find their fortune of fish in the Atlantic waters. Someone growing up in the 1960s could spend their whole childhood swimming in the wealth of cod revenue with dreams of growing up to own a fishing fleet — only to enter the 1980s as an adult and realize that the cod stocks hadn’t grown to meet the market demand and supply. Tragically, almost 95% of cod stocks had depleted and Canada’s Atlantic cod fishery was forced to close in 1992.

There are an ocean of reasons why the seafood market is facing increased scarcity, and these reasons all flow back to one key issue: how can fisheries and seafood resources be managed sustainably? Wild marine life do reproduce, but overfishing and unsustainable seafood consumption rates paint a future where seafood resources become non-renewable as they approach complete depletion, like in the Atlantic cod tragedy. As many countries have battled to balance rising populations, shrinking fish stocks, and an increasingly globalized economy, numerous strategies and solutions have been developed to address these issues.

Identifying a sustainable rate of fishing often involves two considerations: what quantity of seafood can be caught to sustain the stock, and how can these quantities be enforced? Economics provides a classical approach involving property rights and regulation. Canada’s first attempt at applying these practices occurred in the 1980s as a direct response to the cod crisis. The cod stocks had depleted due to open access fishing, where lack of regulation in the Atlantic waters allowed all fishing fleets to take as much of a share as they could. Drowning in worries about the cod stock depletion, the Canadian government attempted to estimate the quantity of remaining cod, and then established a quantity-based permit system for Canadian fishing fleets and international fishers. Additionally, a coast guard was set up to monitor these commercial fishing activities.

Did these classical economic concepts save the stock? It was definitely a start, but unfortunately, the Canadian government’s cod estimates were just that: estimates — and they had overestimated the remaining quantity of cod. Modeling methodologies reflect that the government’s overestimate of the sustainable fishing rate was so detrimental because the cod stocks were in an “unstable equilibrium”, so any hopes for the cod stocks to regrow quickly went down the drain.

Sustainable fishery management hasn’t always been a pipe dream, though, and a different fish stock on the opposite side of the country is the proof. Rather than cod, the wild salmon stock has frequented the west coast and has been a resource cared for by Indigenous nations. Research has shown that Indigenous peoples harvested salmon sustainably for 1000 years, and colonization disrupted those practices (Morin, J. et al., 2021). Tsleil-Waututh First Nation’s sustainable salmon management involved the use of sex selection while harvesting the fish. Male salmon would be caught for consumption, and female salmon would be released back to the waters so that the chances of population reproduction would increase. After European colonization, Tsleil-Waututh’s sustainable practices were disrupted and their fishing weirs were torn down. The 1000-year history of sustainable salmon stocks has taken a turn where an estimated 75% of the salmon stock has now been depleted in just the past 100 years.

The knowledge and success of Indigenous fishery management has often not been acknowledged nor embraced from the perspective of classical economics, likely due to the ongoing effects of colonialism. 2020 saw violent attacks on Miꞌkmaq fishers who had been exercising the right to catch fish and seafood for a moderate livelihood, and instead were attacked and accused of illegally harvesting lobster during off-season periods. Fishery economics got caught in a whirlpool of tensions amplified by seafood stock insecurity. 

Can Canada and the world draw on Indigenous knowledge and lessons from the recent Atlantic cod stock history to develop sustainable fishing practices? Could farmed fishing or aquaculture be the solution, despite the negative environmental impacts and social stigma of aquaculture practices? Aquaculture has brought its own stock of fishy problems, bound to exist since the industry has grown 14-fold after the 1980’s cod crisis and is now “the world’s fastest-growing food production system”. 

Will we ever be able to catch a good sustainable seafood management solution? Like the government’s attempts to model and estimate fish stocks, economists can only do their best to estimate when we may “sea” a future with long-term sustainable fishery management.